Stock-Based Compensation

9 Months Ended

Sep. 30, 2018

Stock-Based Compensation [Abstract]

Stock-Based Compensation

Stock-Based Compensation

We recognized $1.5 million and $1.1 million in pre-tax compensation expense related to stock options and restricted stock units during the three months ended September 30, 2018 and 2017, respectively, and $4.5 million and $2.2 million during the nine months ended September 30, 2018 and 2017, respectively. Stock compensation expense recognized during the nine months ended September 30, 2017 was impacted by the reversal of unvested stock compensation in the first quarter of 2017 for stock awards previously granted to former executives. During the nine months ended September 30, 2018, we granted approximately 554,000 stock options, 673,000 market-based performance restricted stock units and 490,000 time-vesting restricted stock units. The stock options granted were valued using a Black-Scholes pricing model with the following assumptions: an expected volatility of 44.97% to 56.01%, a risk-free interest rate of 2.07% to 2.78%, no expected dividend yield, and an expected term of 3.50 to 5.75 years. The weighted-average exercise price of the options granted during the nine months ended September 30, 2018 was $9.06 and the weighted-average grant-date fair value was $3.97. Performance-based restricted stock units are valued using a Monte Carlo simulation. Time-vesting restricted stock units are valued using the closing price on the trading day immediately preceding the day of the grant. The weighted-average grant date fair value of the market-based performance and time-vesting restricted stock units granted during the nine months ended September 30, 2018 was $9.03 and $8.58, respectively.